Skills development levy: What employers need to know before submission deadline
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Johannesburg - As the deadline for Skills Development Levy (SDL) submissions approaches (end of April 2023), employers must understand the importance of complying with the levy and the positive impact it has on South Africa's economic and social development.
Employment Equity & Skills Development Specialist at Strata-g Labour and Transformation Solutions, Lindi Kekana, said the levy is crucial for employee skill development, which enhances workplace performance and productivity, contributing to economic growth. All employers whose annual gross wage exceeds R500,000 should pay the 1% Skills levies to SARS before the 7th of each month. The funds collected through SDL are utilised by the respective Sector Education and Training Authority (SETA) and the National Skills Fund to support various skills development programmes and initiatives aimed at improving skills development and training in South Africa.
These initiatives include learnerships, skills programmes, and bursaries, which provide opportunities for employed and unemployed individuals to gain new skills and qualifications, increasing their chances of securing better employment.
Moreover, employers can enjoy a range of benefits by paying their SDL. For instance, 20% of their levy can be claimed back in a Mandatory Grant, and 49.5% of their levy can be claimed in Discretionary Grants, such as Learnerships, Skills Programmes, Apprenticeships, Workplace Experience Placements, Internships, and Bursaries.
They can also get tax rebates on registered learnership programmes. Employers can leverage SDL to their advantage by ensuring compliance with the SDL requirements and maximising the benefits of their contributions.
This includes submitting their Work Skills Plan (WSP) and Annual Training Plan (ATP) each year, reporting on the training that took place and the coaching they plan to do in the current year, and applying for the discretionary grant. Compliance with SDL requirements is crucial to avoid penalties dependent on the percentage of the annual payroll.
Employers should not see the levy as a tick-box exercise, but rather as a means of developing their employees' skills and contributing to the country's economy. Studies have found that better-educated and engaged employees are more productive and produce a higher quality of work. When employees feel their development is taken seriously, they are more likely to go beyond the call of duty.
Employers who are struggling with compliance must not ignore it, but rather seek the assistance of qualified professionals. Investing in employees' skills and training is crucial for improving their performance, contributing to the country's economy, and ultimately building a more prosperous future for all.
Therefore, employers must comply with SDL requirements to maximise the benefits of their contributions. It is not only their legal obligation, but it also ensures their employees and their company's long-term success.
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